The industrial age has given rise to a global economy of factories engaged in mass production of various goods. An enormous amount of commerce is transacted in the buying and selling of such goods. While some such goods lose their value with use, e.g., food products, many such goods retain a substantial portion of their value even after use or ownership by another. Such goods are referred to herein as “durable.” A considerable amount of commerce is transacted in the buying and selling of durable goods, particularly used durable goods.
Almost all durable goods are readily identifiable by a standard unique identification code (“ID code”), particularly those that are mass produced. In the case of computer software, music cassettes or compact discs, videocassettes and digital video discs, the ID code may be a human readable Universal Product Code (“UPC”), a thirteen digit ID code that readily identifies the good. In the case of books, magazines or other publications, the ID code may be a ten-digit International Standard Book Number (“ISBN”). Other items are more readily identified by a manufacturer or brand name and a model number, as for baseball cards and consumer electronics, e.g., a Sony® KV-3620 television. Some goods may be identified by more than one type of ID code.
Many durable and readily identifiable goods are fungible items that derive their value substantially from their common characteristics. For example, a single signed copy of Michael Jackson's album titled “Thriller” and recorded on a compact disc (“CD”) derives much of its value because it is signed by the performance artist. Such a CD is unique and therefore is not a fungible good. In contrast, an unsigned copy of Michael Jackson's “Thriller” CD derives substantially all of its value because of the songs recorded thereon. Therefore, all such CD's have substantially the same value to consumers. Such CD's are therefore fungible.
Auctions provide one type of marketplace for selling goods. Used goods sold at auction are sold at prices set by interested buyers. An auctioneer facilitates sale transactions without the need to maintain goods in inventory. Auctions are particularly good for sellers to ensure a highest possible sale price, especially for unique, non-fungible items. However, determining and ensuring a fair price is difficult for buyers. Buyers must have a high degree of knowledge to determine whether a price for a certain good is fair.
Retail selling also provides a marketplace for sale of goods. Used goods sold at retail are sold at prices set by a seller. Retail selling is advantageous to the seller because it allows the seller to control the price of the good. However, it requires the seller to maintain a large inventory of goods, which is expensive and disadvantageous. Competition, particularly for fungible goods, drives prices downwardly, which is advantageous to the buyer. The seller must have a high degree of knowledge to ensure that his price is competitive. In addition, a price for a good may be fair to the buyer when set by the seller, but may no longer be fair if market conditions change after the price is set and before the buyer purchases the good.
Electronic commerce, or Internet-based sales are common and have problems similar to retail. Numerous online auctions may be found. An example of such an online auction is held by eBay Inc. of San Jose, Calif., at www.ebay.com. Such auctions are better suited to unique goods but are also used for fungible goods. However, “bidding wars” between buyers can lead to high prices for such goods, whether new or used.
Retail type sales are also conducted at numerous online websites, such as www.amazon.com. Online retail selling is also disadvantageous because it requires the seller to maintain a substantial inventory of goods. A reverse-auction system, where a seller may accept a price set by a buyer is provided on the worldwide web at www.priceline.com by priceline.com Inc. of Stamford, Conn. U.S. Pat. No. 5,797,127 to Walker et al. discloses a reverse auction method, apparatus and program for pricing, selling and exercising options to purchase airline tickets.
For electronic commerce applications, software-implemented shopping agents are well known. Using a shopping agent, a buyer can identify vendors and prices for a good. One type of shopping agent queries multiple vendor's websites to determine a best price or list of prices. For example Cendant Corp. of New York, N.Y. is a retail seller of new books that provides access to such a shopping agent on the worldwide web at www.books.com. Books.com uses a pricing agent (“Price Compare”) to price items it sells and holds in its inventory. It uses the shopping agent to query several competitors and, if its price for a new book is not less than its competitors' prices, the pricing agent sets the price for its new book at less than the lowest competitor's price for the same new book. However, the seller still controls the price since it determines the method used by its pricing agent to set the price. In addition, the seller is required to maintain a substantial inventory of books.
Until now, there has been no acceptable way to facilitate sales of goods that ensures fair pricing while eliminating the need for inventory and minimizing pricing burdens on the buyer and the seller. In addition, there is no acceptable way to exploit the fungible nature of durable goods.
Accordingly, it is an object of the present invention to provide a method for facilitating pricing and sales of goods.
It is another object of the present invention to provide a method which does not require maintenance of an inventory of goods.
It is yet another object of the present invention to provide a method for pricing goods for sale by independent sellers.
It is a further object of the present invention to ensure lowest pricing of goods which exploits the fungible nature of goods.
It is yet a further object of the present invention to exploit the fungible nature of used durable goods to price goods.
It is yet a further object of the present invention to derive a price for an independent seller's good as a function of a third party's price for a similar good.
It is yet a further object of the present invention to provide an apparatus for facilitating sales and pricing of goods.
It is yet a further object of the present invention to provide a computer-implemented method for facilitating sales and pricing of goods.